SSingapore, which is a major export center for
refined products, has been somewhat of a bellweather for the Asian refinery
market.

SThe Asian financial collapse in 1998 resulted
in demand and refinery utilization falling in Singapore, but subsequent
demand recovery resulted in utilization again growing last year and this
year, approaching 1998 and 1999 levels.

SBecause Asian demand also draws on supply from
the Middle East, high utilization in Asia is likely to affect Middle Eastern
refineries more than any other region.

SThere potentially is some spillover into U.S.
markets.California, which sometimes
draws product from Asia, could see some higher prices as a result of the
tightening Asian market, but most U.S. product imports come from the Atlantic
Basin, which is described in the next slide.